The 70-year-old made a shock move to rival firm Janus Capital on the weekend, resulting in a “media firestorm” for Pimco, said a Morningstar analysis.
But also, according to Morningstar, Mr Gross’ departure “isn’t terribly surprising”.
“At 70 years old and openly acknowledging the potential for his departure, we expected him to leave in the next few years,” the research house said.
“Pimco and its clients have been preparing for that at least since former chief executive and co-chief investment officer Mohammed El-Erian left the firm in early 2014.”
While Mr Gross’ departure will inevitably mean change at Pimco, Morningstar recommended that advisers and investors “sit tight”.
“It’s worth taking time to assess what these changes mean in the short- and long-run, but it’s also wise to remember that PIMCO has been home to some of the best thinkers in the industry, besides Bill Gross, for a long time,” Morningstar said.
“The appointment of six deputy-chief investment officers in early 2014 means that the firm already has a solid structure in place to effectively manage client portfolios.”
Despite Morningstar’s relaxed attitude towards Mr Gross’s exit, most global strategies the research house rates have been placed ‘under review’.
On the local front, there will be no portfolio manager changes in the Sydney offices which means the Pimco EQT Wholesale Australian Bond fund and the Pimco EQT Wholesale Pimco Australian Focus fund will retain their Morningstar ‘Gold’ and ‘Silver’ ratings, respectively.
The biggest immediate risk for investors is a wave of redemptions from Pimco funds, Morningstar said.
“However, PIMCO’s portfolios are mostly invested in highly liquid securities so it takes a very extreme scenario to start getting concerned about its ability to meet those redemptions,” the research house said.
